A day before the new government is going to be declared, Wholesale Price Index (WPI)- based inflation came down to 5.2% ahead of the RBI's monetary policy review early next month. The WPI measured inflation was 5.7% in March but it reduced to 5.2% in April as per the data released by the government on Thursday.

The
government data releases WPI inflation in the overall food segment
eased to 8.64% in April from a hight of 9.9% that was in March.

Commenting
on the decline in WPI inflation, industry body FICCI's President
Siddhartha Birla said in a statement, “The headline inflation has
shown a dip on the back of moderation in prices of food articles,
fuel and power. However, given the recent increase in the diesel
prices and uncertain outlook for monsoon, price movements will have
to be critically watched going ahead. For the new government this
would be the single biggest challenge. We look forward to a
comprehensive action plan to tackle this situation."

In
Focus

Assocham
also expressed its serious concern about the WPI in April 2014. It
said in a statement, “Though there is a slight moderation in the
headline inflation owing to a fall in the prices of selected primary
articles and fuel, WPI for April remained high at 5.2%. On the other
hand, increase in the prices of manufactured products remained
subdued.”

D
S Rawat, Secretary General Assocham said, “The underlying reason
for prolonged un-abated hyper inflation remains that of supply side
constraints and addressing these constraints pose perhaps the biggest
challenge to the new government. Many of the bulk products,
especially the agriculture produce, are perishable and require
fast-moving supply lines.”